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Battle brewing over bid to end 3.2 sales

Liquor stores resist expansion of beer outlets

By Roger Fillion, Rocky Mountain News (Contact)

Published January 12, 2009 at 12:05 a.m.

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Local grocery and convenience store operators are looking to Colorado lawmakers to ban "3.2" beer this year so they can stock regular beer on their shelves.

But expect a fight.

Grocery and convenience store advocates say Colorado's decades-old 3.2 beer law is antiquated and puts them at a competitive disadvantage with liquor stores, which now can open on Sundays and sell full- strength beer.

Lawmakers in coming weeks are expected to offer a bill banning 3.2 beer and allowing grocery and convenience stores such as 7-Eleven to sell regular brew.

The grocery and convenience store operators are likely to encounter opposition from liquor store owners, liquor wholesalers and others.

They argue that grocery and convenience store sales of regular beer would shutter many of the state's more than 1,600 liquor stores and throw workers out of jobs.

"It will be a lively and competitive bill," predicted Rep. Buffie McFadyen, D-Pueblo West, a sponsor of the planned legislation.

Aside from Colorado, five other states have rules governing sales of 3.2 beer: Kansas, Minnesota, Missouri, Oklahoma and Utah.

Ironically, 3.2 beer is not much different from many regular domestic lagers on liquor store shelves. The alcohol content of regular beers is measured by volume, while with 3.2 beers it's measured by weight.

Coors Light and Bud Light, for example, have an alcohol content of 4.2 percent by volume, according to Realbeer.com. If 3.2 beer was measured the same way, its alcohol content would be listed at 4 percent.

The 3.2 measure would follow a bill that Gov. Bill Ritter signed into law last year that made Colorado the 35th state to allow liquor stores to sell booze on Sundays. The state had banned Sunday liquor sales since the repeal of Prohibition in 1933.

Since the law took effect last July, grocery and convenience store operators have complained that their sales of 3.2 beer have tanked - especially on Sundays.

Before the Sunday law took effect, the only beer consumers could buy on Sundays was 3.2 beer sold at grocery and convenience stores.

"It totally killed the Sunday beer sales," Sandip Mali, operator of two 7-Eleven franchises in Denver and Thornton, said of the Sunday liquor law. "After the legislation passed there was an awareness that 3.2 beer was different."

Since the new law, Mali said his overall sales of 3.2 beer at both stores have plunged more than 75 percent.

"We were selling roughly $1,000 or more a week at each store. We're down to about $200," said Mali.

Liquor store owners counter that grocery and convenience store operators want to win the right to sell regular beer so they can next demand the right to sell wine and liquor, too.

"This is a change they're pursuing to get full-strength beer because that would give them an opportunity to have wine and liquor follow," said Kim Schottleutner, owner of DTC Wine & Spirits near the Denver Tech Center.

Colorado lawmakers killed a bill last year that would have allowed grocery stores, gasoline convenience stores and big retailers such as Wal-Mart to sell full-strength beer and wine in Colorado.

Schottleutner said liquor stores generally depend on beer sales for 30 percent to 50 percent of their revenue. Beer accounts for 35 percent of the sales at his store.

"Our operating revenue would be dramatically affected," said Schottleutner, who employs seven people. "We're going to jeopardize the revenue of many liquor stores."

fillionr@RockyMountainNews.com or 303-954-2467

The legislation

* What: State lawmakers are expected to take up a bill to end 3.2 beer sales and allow grocery and convenience stores to sell regular beer.

* How: The bill automatically would convert every 3.2 beer license to a license for full- strength beer. Any retailer with a 3.2 license could sell regular beer. Retailers that don't sell beer could seek a full-strength license.

* When: On or about July 1, if passed.

* Who: Supporters include grocery and convenience store operators such as 7-Eleven.

Opponents include liquor store owners, liquor wholesalers, craft brewers and the distilled spirits industry.

* Sponsors: Sen. Jennifer Veiga, D-Denver; Rep. Buffie McFadyen, D-Pueblo West

Comments

  • January 12, 2009

    5:58 a.m.

    Suggest removal

    LOUIE writes:

    Watered down beer is ugly, but with the Sunday selling of hard booze it became evident the grocery stores would want concessions. So if the grocery store does get the concession, many small booze shops will be closing as beer is thier predominent product sold. I don't want to walk to Argonauts or some big booze shop, I enjoy the many small package store close buy. Now if the grocery stores could sell me John Jameson and Sons, I'd agree but their not. Beer sales are 80% of a small shops sales, turn it over to the grocery stores, and many of the small shops will be severely affected, making those of us who drink the tough stuff go further, giving the big outlets like Argonauts more of a monopoly on the market of hard booze. I like more choice, and yet contrary to more choice, I support shutting down booze sales on Sunday but that's a personal religious preference and not widely accepted and I understand the opposition all to well.

  • January 12, 2009

    6:44 a.m.

    Suggest removal

    dadio161 writes:

    I feel that it is only fair to the convienence stores and super markets that they be allowed to sell regular beer. A customer will still need to go to a liquor store to buy LIQUOR.

  • January 12, 2009

    7:49 a.m.

    Suggest removal

    Marshdale writes:

    To hell with the grocery stores. I'm ired by the constant drum beat of big box stores runing the little guy out of business.

  • January 12, 2009

    7:56 a.m.

    Suggest removal

    timeandagain writes:

    Compete or die!! Boo Hoo Marshdale...

    Let 7-Eleven sell beer/wine & let the liquor stores begin selling "convenience" products & food.

  • January 12, 2009

    8:05 a.m.

    Suggest removal

    Marshdale writes:

    timeandagain: You are obviously a conservative. Competition is what you guys love. I understand that, but you guys applaud corporate merger like a caberet. What do corporate mergers create? Less competition and higher prices. Just what do you think happens when there is only one fat cat on the block? Do you honestly think you will get a price advantage as a consumer when the one fat cat can charge whatever they want, because they dominate?

  • January 12, 2009

    9:08 a.m.

    Suggest removal

    Gonzopozo writes:

    Pretty soon we'll have one-stop shopping for everything.

    Wal-Mart.

  • January 12, 2009

    9:31 a.m.

    Suggest removal

    mt writes:

    If grocery stores want to compete then they should have great sales on Sundays to get their customers back. There is no noticeable difference in 3.2 and 6 percent. Educate the public to that then things may also change. As the paper states it is only .2 percent difference. Great sales brings in people.

    Louie I am not trying to start an arguement as I have heard many people complain about beer sales on Sundays due to religious beliefs. My only question is; why would you want it to shut down rather then just not buy on Sundays if that is how you feel. It just feels that forcing a shut down is the same as forcing your or their religion down the throats of those that have different beliefs.

  • January 12, 2009

    9:33 a.m.

    Suggest removal

    blindrid writes:

    I don't understand the concern as the markup on beer is so minimal, if one is depending on beer sales to keep the doors open they are in trouble.

    Overall, there are two concerns:
    1) The big stores will be able to take advantage of multi-case discounts that the smaller stores cannot afford thus under cutting price, and
    2) Getting "liquor store" beer may be just the start of opening up the liquor laws taking out the ma and pa's.

    I'm OK with keeping it the way it is as there are typically a liquor store in the same strip mall as the grocers so it's not inconvenient to the public. The convenience stores have so many other products to profit from, I'm not sure the additional revenue is worth the refrigeration space and labor. I'm sure the philosophy with them would be get one into the store and sell impulse, high mark-up items.

  • January 12, 2009

    9:56 a.m.

    Suggest removal

    the_ripper writes:

    Grocery stores are for groceries. Liquor stores are for beer wine and booze. How simple is that?

  • January 12, 2009

    10:38 a.m.

    Suggest removal

    FlyfishDude52 writes:

    mt - Do you work 7 days a week for the same pay as 5 days? Yeah, I thought so. That's what's happened to liquor stores since the Sunday opening. The net result is that any purchases made at a liquor store will go up as a result of increased overhead for the same volume of sales. And that doesn't really tell the whole story. I liquor stores can be open on Sunday I think car dealers should be open also.

    Can you imagine going into a grocery store or wal-marf and asking someone what the relative virtues are of a particular cabernet that you're interested in? Yeah, it's like getting "professional" advice from a guy in the electrical department at home depot. Hey, why not sell high-point beer there, too?

  • January 12, 2009

    11:13 a.m.

    Suggest removal

    smilin_69 writes:

    The consumer should be KING ! ! let him/her shop where they want to buy what they want. the government should not favor one business group over another.

    I, for one, would love one-stop shopping. go to the store, buy food, reg. beer and maybe a bottle of wine. it's about convenience. I don't like making multiple stops because of gov't rules. I don't mind making multiple stops if I want to get something at a specialty store. but that's MY choice.

    I'm sorry if a small liquor store can't compete. but it's not about them. it is about what the consumer wants.

  • January 12, 2009

    11:17 a.m.

    Suggest removal

    c4l2a0 writes:

    Just because convenience stores could sell regular beer, doesn't mean that the small shops will go out of business.

    Louie, you are wrong about this (I predict) and I use your own argument to support my reasoning. Most of us will still go to the same liquor stores that we frequent. The most likely exception is when we do our weekly grocery shooping at King Soopers and pick up a 6 pack out of convenience.

    For the most part, when I need to run out to grab some beers, I'll go to the small shop in my neighborhood. But it would be nice to have logical, fair, options.

    This legislation levels the playing field and doesn't intentionally favor any one type of business.

    Long live capitalism!

  • January 12, 2009

    11:45 a.m.

    Suggest removal

    mt writes:

    Flyfish - Your arugement with me makes no sense. For one, why are you arguing with me? Second is that the law did not force liquor stores to open on Sundays it just gave them the option. They were open six days a week prior to this not five. If they are making less money being open seven days then perhaps they should close their doors on a slow day of the week. Third, the article is about grocery stores wanting to sell 6% beer not about liquor stores losing money because they are able to open an extra day. What does a car dealer working on Sundays have to do with grocery stores wanting to sell 6% or what does it have to do with my point that I don't think religion should dictate when an establishment is allowed to sell liquor as my point to Louie stated. I am really lost as to what your points are. Please explain more.

  • January 12, 2009

    12:04 p.m.

    Suggest removal

    glowrock writes:

    California has no rules governing supermarkets selling regular beer OR hard liquor, and I see no lack of liquor stores as a result. Plenty of big ones, plenty of small ones, and it's great to grab your food, some beer, and maybe a bottle of wine at the same place. If I want a specialty item, I go to a liquor store, period.

    What's the big deal? Too much whining by the small liquor store owners. That being said, definitely allow them to sell convenience food items as well. No reason to stop them from doing that if supermarkets can sell full strength beer!

  • January 12, 2009

    12:08 p.m.

    Suggest removal

    Timberline writes:

    I use to shop at the King Soopers on Broadway & Mineral, now I shop at the new Safeway across the street because it has a FULL liquor store. I lived in Michigan and all grocery stores sell liquor, there has never been an issue. Liquor stores in MI are called Party Stores and also sell food, tobacco, party goods, etc..
    I agree with glowrock, what's the big deal?

  • January 12, 2009

    12:09 p.m.

    Suggest removal

    the_ripper writes:

    I can generally hit the grocery store AND the liquor store without moving parking spots. I tiny bit more excercise walking a storefront or two down won't hurt anyone.

  • January 12, 2009

    12:19 p.m.

    Suggest removal

    pete10000ft writes:

    Flyfishdude: read wine spectator and you'll know what to buy. All Liquor store emloyees just regurgitate it anyways....

  • January 12, 2009

    12:21 p.m.

    Suggest removal

    cdmdenver writes:

    ONE STOP SHOPPING,CHINA-MART- LOW PRICES EVERYDAY!

  • January 12, 2009

    12:44 p.m.

    Suggest removal

    michigfab5 writes:

    Come on. Other states have been allowing liquor stores to remain open 7 days a week while allowing grocery stores to sell full strength beer and liquor with no problem. You people are getting upset over nothing.

  • January 12, 2009

    1:53 p.m.

    Suggest removal

    HankReardon writes:

    That's right, ripper. In many states, you just can't go to the grocery store or corner convenience store for alcohol (nor even 3.2). There, you can't buy alcohol anywhere on Sundays except in bars. They usually have a cooler with 6-packs for sale in the bars (limit: 2 packs per person.). Grocery stores should focus on groceries.

  • January 12, 2009

    2:13 p.m.

    Suggest removal

    NightTwister writes:

    I wonder how many liquor store owners said, "No, don't allow us to be open on Sunday. That would take away sales from stores that are limited to selling 3.2 beer!"

    Yeah...that would be zero.

  • January 12, 2009

    2:16 p.m.

    Suggest removal

    HankReardon writes:

    Maybe liquor stores should have a meat department?

  • January 12, 2009

    2:39 p.m.

    Suggest removal

    Darwin writes:

    It would be nice if the legislature would consider what is best for the consumer for a change and not what is best for business, large or small.

    the_ripper writes: "Grocery stores are for groceries. Liquor stores are for beer wine and booze. How simple is that?"
    When is the last time you were in a grocery store? I can buy products for my car, animal products, books, cards, pots and pans etc. The days of selling only groceries is long past.

    As to others mentioning states that allow grocery stores to sell regular beer and wine, I will add Ohio to the list. There are still many "small" liquor stores in spite of all the "scare" tactics presented here in Colorado.

  • January 12, 2009

    3:01 p.m.

    Suggest removal

    Heidi writes:

    Pretty soon the government will be cracking down on kids' lemonade stands. But they are almost non-existent anymore because most kids learn that they can demand anything they want from their parents and they don't have to earn it.

  • January 12, 2009

    7:30 p.m.

    Suggest removal

    HopiMedicineMan writes:

    The big fish swallow the little fish until there's one fish.

  • January 14, 2009

    6:05 p.m.

    Suggest removal

    Boltfan007 writes:

    No one will ever see this since the RMN is wilting, but doesn't anyone care that the "Likker Queen" Jennifer Viera is once again schilling for the elimination of the mom&pop liquor stores.
    Someone needs to find out why she is behind every liquor bill that is sponsored. Is that what her constituency hired her to do, and if so, why??? Checking her campaign contributions will tell you!